US government officially tops $1 trillion in deficits for third straight year

The federal government notched its sixth-highest monthly deficit in history in August and is now over the $1 trillion deficit mark for the third straight year, according to the Congressional Budget Office.

CBO, which releases estimates each month, said the government ran a $192 billion deficit last month. That’s the highest deficit ever for August, which is not traditionally a major month for running in the red.

That deep monthly deficit powered the government well past the $1 trillion mark for the fiscal year. With a month still to go, the government is already running $1.17 trillion in arrears.

That is still somewhat better than last year, when the deficit at this point was $1.23 trillion.

Rising wages have brought more tax revenue into the government this year, while new spending has risen at a slightly lower pace, which explains the declining deficit. Medicaid and unemployment benefit spending both dropped as heightened stimulus spending ended, and lower costs for the wars in Afghanistan and Iraq have also meant less spending on defense.

But Social Security is up 6 percent and Medicare spending is up 4 percent compared with 2011, CBO said.

CBO does an early estimate each month of the government’s fiscal position. Final numbers will come later this month from the Treasury Department.